Compared to last week, yearlings traded 5.00-10.00 lower with calves selling 10.00-20.00 lower, with instances 25.00-30.00 lower. Order buyers this week were extremely cautious after aggressive pressure from the Stock Market tumble and with very bearish outside markets keeping a strain on all commodity markets. This had order buyers wanting and needing to buy feeders cheaper this week.
The cattle complex remains focused on the ability for outside market fundamentals to stabilize and to steady. Demand for calves was light to moderate, with best demand for yearlings; several auctions were getting ready for the "fall run" noting the arrival of new-crop bawling calves this week. With corrections coming in the feeder cattle market, this has prices retreating with pressure coming from fed cattle prices heading back to their summer lows.
On Friday, dressed sales in Nebraska sold 4.00-6.00 lower at 228.00 with live sales 4.00- 5.00 lower from 144.00-145.00. Many backgrounders and cattle grazers who have held a little too long are not going to see a rally they have enjoyed in the past, as many yearling steers weighing from 850-950 lbs are trading both sides of 200.00; Prices dropping 10.00-15.00 from early summer highs.
As fed cattle prices are declining, cattle feeders are adjusting what they pay for feeder cattle. So far this year, feeder cattle prices have been too high in relation to fed cattle prices and even despite lower feeder cattle prices this week demand remains good for yearlings in the Northern Plains.
At the Sheridan Livestock Auction in Rushville, NE near 3700 yearlings on offer Wednesday with 465 head of top quality yearling steers averaging 835 lbs selling with a weighted average price of 206.23 and 120 fancy yearling steers weighing 950 lbs sold at 207.00. In Kearney, NE on Wednesday at the Huss-Platte Valley Livestock Auction sold 620 head of yearling steers averaging 909 lbs for a weighted average price of 206.02 with the market mostly 7.00 lower for 9 weight steers. Expectations of a large corn crop on the horizon remain, especially in the Western Corn Belt. Even in a year with many challenges, much focus remains in the huge losses from the Stock Market from late last week through Tuesday of this week. The Dow accelerated its losses Monday briefly plummeting more than 1000 points at the open to close with losses of 588 points; losses extended into Tuesday falling another 200 points. It seems that panic selling and a "get me out" attitude prevailed in several markets this week. Traders at this point are looking for a safer place to hold and invest money at this time.
Livestock markets remain vulnerable and reacted with lower prices in reaction to global financial worries mostly coming from China’s economic fears. Traders know this affects the commodity markets and as a result, funds have been mostly sellers to reduce their exposure in the commodities. The sell-off in the cattle complex is much hastier and fast paced than the rallies, just getting back to even is a big task.
The cattle futures at this time can’t catch a break, compared to other agriculture markets as lean hogs and corn have shown some stability. At this point, cattle prices have had the most downside going forward, however there was good news on Wednesday as the Stock Market regained its footing after an extended rout, and surged to close over 600 points higher to snap a six-session losing streak. This was the Dow’s third-biggest point gain in history. Hopefully giving the markets a reprieve from fear and panic is showing some level of stability and signs of easing.
Gains extended into Thursday and Friday as cattle futures finally caught a break and surged higher closing with strong triple-digit gains. Boxed beef values started the week lower and on the defensive as retailers have Labor Day orders essentially filled, as the selling in the markets may have potential meat buyers on the cautious side. Choice boxed-beef closed .99 cents lower on Friday at 243.22 compared to last Friday’s close at 244.90. Auction volume included 52 percent weighing over 600 lbs and 34 percent heifers.